Could Iran’s Revolution Unravel Over a Four-Cent Price Hike?

Protests erupted throughout Iran in November, over an increase in gas prices, and the regime responded with deadly force. Photograph from Middle East Images / Redux

December 6, 2019 -The New Yorker – By Robin Wright

In mid-November, in a surprise overnight announcement, the revolutionary regime in Iran hiked the price of gasoline. By standards anywhere else in the world, it is still pitifully cheap. A litre of gas increased from eight cents to twelve cents—or to fifty cents per gallon—for the first fifteen gallons each month.

That’s about a tankful for a large car. After that, gas went up to ninety cents per gallon. (The U.S. average is around two dollars and sixty cents per gallon.) The price hike nevertheless triggered instant outrage. During the next four days, protests erupted in a hundred cities across the country. The theocracy responded with ruthless brutality. Hundreds, at least, were killed.

“As the truth is trickling out of Iran, it appears the regime could have murdered over a thousand Iranian citizens since the protests began,” Brian Hook, the U.S. special representative for Iran, said at a State Department briefing about the unrest, on Thursday. At least seven thousand were detained, and “many thousands” were wounded, he said. To curtail the protests and contain reports about it, Iran cut off access to the Internet. After access was restored, the State Department set up a tip line on Telegram, for Iranians to submit video, photos, and other evidence of the government crackdown. Hook said that it received more than thirty-two thousand responses.

The protests represented the widest unrest since the 2009 Green Movement uprising over alleged fraud in a Presidential election. They were the deadliest since the 1979 revolution, which ousted the last dynasty. By the government’s own count, protesters torched more than seven hundred and thirty banks, destroyed a hundred and forty government sites, and attacked fifty police-force bases.

The protests quickly escalated from being about the price of gasoline to being about the future of the theocracy. “Have shame, dictator—leave the country alone!” protesters shouted in Mashhad, Iran’s holy city, normally a bastion of conservative support for the Islamic Republic. The term “dictator” refers to Ayatollah Ali Khamenei, Iran’s Supreme Leader for the past three decades. In the oil-rich Khuzestan Province, demonstrators chanted against President Hassan Rouhani: “Have shame, Rouhani—leave the country alone!”

“The November unrest is at least as serious a threat to the longevity of the Islamic Republic as the post-election upheaval in 2009 was at that time and arguably more challenging to overcome or durably repair,” Suzanne Maloney, the deputy director of the foreign-policy program at the Brookings Institution, told me. “Back then, the main schism was within the political establishment and secondarily within the politically engaged middle class.” A decade later, she said, “the fissures run deeper into the core constituency of the regime, and the disaffection is more systemic and more intense.” The internal tensions, including the government’s brutal response, “are indicative of a system whose resilience is dangerously fraying,” she said. She compared it to “a slow-motion metastasis that is echoing across the political establishment, the economy, and society.”

Utopian ideologies and revolutionary regimes are often undone by a confluence of political and economic factors, which is exactly what is happening in Iran. The political unrest intersected with chronic economic challenges produced by the Trump Administration’s “maximum pressure” campaign, combined with regime mismanagement and corruption. The United States reimposed sweeping economic sanctions a year ago, a few months after walking away from the historic nuclear deal that was brokered between Iran and the world’s six major powers, in 2015. Sanctions have cut off Iran’s ability to export oil, its primary source of revenue. In 2016, it exported 3.2 million barrels of oil per day; this fall, it’s been down to about three hundred thousand barrels of oil. The value of Iran’s rial has also plummeted, slashing consumer buying power for daily goods and raising the price of all imports. In 2015, the rial traded at just over thirty thousand rials to the dollar. Today, it trades at almost a hundred and thirty thousand rials to the dollar. Although the rial had stabilized, food inflation was, until recently, between sixty per cent and seventy per cent during a twelve-month period, Adnan Mazarei, an Iran specialist at the Peterson Institute for International Economics and the former deputy director of the International Monetary Fund’s Middle East Department, told me. In October, the I.M.F. downgraded its economic forecast for Iran. Its economy is expected to contract by 9.5 per cent this year—its worst performance in thirty-five years, since the nineteen-eighties, when the country faced challenges during eight years of war with Iraq.

The price hike was actually a smart move economically, according to the I.M.F. Iran has long provided subsidies for basic commodities that it cannot afford because its population has mushroomed from just over thirty million at the time of the revolution, forty years ago, to more than eighty million today. The plan was designed to help the poor. It cut subsidies that also helped the rich consume even more; it included doling out millions in cash to the lower classes to compensate for the price hike. “Under the current circumstances that the country is facing the most unprecedented sanctions and pressures, the main reason for adjusting prices is to promote social justice or to move toward that [goal],” Ali Rabiei, the government spokesman, told a local news agency. The mistake was failing to provide advance warning or details, Mazarei said.

Iran’s Supreme Leader blamed the United States and Israel for fomenting the unrest and local thugs for exploiting it. Security forces put down “a very dangerous, deep conspiracy that cost so much money and effort,” Khamenei said in comments to the Basij, a paramilitary force under the Revolutionary Guard. “In such incidents, hooligans, spiteful and evil people, often enter the field and, sometimes, some youths, driven by emotion, accompany them and commit seditious acts. Such deeds do not fix anything other than adding insecurity to the problems.” Iran’s Revolutionary Guard—the élite force created to preserve the revolution—has vowed to quash any future unrest. “If necessary we will take decisive and revolutionary action against any continued moves to disturb the people’s peace and security,” it said, in a statement.

For now, the Islamic Republic may be able to contain the unrest. “The violence is not necessarily a precursor to more massive political violence in Iran; nor is it the desperate and bloody response of a regime verging on collapse,” Elizabeth Rosenberg, a former treasury specialist now at the Center for a New American Security, told me. Despite Iran’s struggles under powerful sanctions, “it would be folly to underestimate the staying power of Iran’s regime élites who are experts at repressive rule and economic resilience in conditions of extreme hardship,” she said. “We should not expect a fatal turning point for the revolution any time soon.”

The November protests are the fourth major challenge to the revolution. In July, 1999, students protested for five days against the closure of a reformist newspaper; it was put down by force when security forces raided dormitories and campuses. In 2009, millions rose up across the country to protest voter fraud in the reëlection of President Mahmoud Ahmadinejad. The demonstrations ran on sporadically for more than eight months. Thousands were arrested, including former government officials and members of parliament who backed the protests. Two of the opposition’s Presidential candidates—former Prime Minister Mir-Hossein Mousavi and former Parliamentary Speaker Mehdi Karroubi—are still under house arrest. In late 2017 and early 2018, protests lasted for weeks in thirty of Iran’s thirty-one provinces over economic issues, including unemployment and unpaid wages.

The question now is how much support the revolution has lost with each round. “The Iranian regime keeps losing major constituencies in its revolutionary base: first the students, then the middle class and merchants, then the working class, and even many of the clergy who criticize the regime,” Hook, the State Department envoy, said. “Now, in the latest protests, nine seminaries were burned. The only support left for the regime is with a handful of clerics whom the Iranian people despise for having imposed forty years of brutality on them.”

One of the striking aspects of the two most recent rounds of protests, in 2017 and this year, is that they were largely spontaneous with no known national leadership, Marazei noted. They were decentralized. In the latest unrest, the protesters also played into local grievances, such as discontent among the Arab minority in Khuzestan Province. The State Department said that it received a video showing troops from the Revolutionary Guard mowing down protesters in Mahshahr, a city in southwest Khuzestan. When protesters fled to the nearby marshlands, troops surrounded them in trucks mounted with machine guns. Screams of the victims could be heard on the video. In that one incident, the regime murdered several hundred. “When it was over, the regime loaded the bodies into trucks,” Hook said. “We do not yet know where these bodies went, but we are learning more and more about how the Iranian regime treats its own people.”

Pressures on the regime are certain to grow, with the United States promising to further tighten the economic squeeze until Iran returns to the negotiating table. “An amorphous, unpredictable movement that is fiercely estranged from the Islamic Republic represents an acute vulnerability for Tehran, especially at a time when key political transitions, like succession, loom large,” Maloney said. Iran faces parliamentary elections in February and a Presidential election in 2021; Rouhani is now a lame duck. The more important transition will come when the Supreme Leader, who turned eighty this summer, dies. His replacement will set the tenor for Iranian politics, security, and the economy for the future. “The regime can maintain and even intensify its violent repression of protestors. But the system’s legitimacy rests on some foundational claim to popular support,” Maloney said. “Routine reliance on fierce crackdowns, applied across the country, will further erode the coherence of the system and compound the challenges facing the current leadership.”

In other words, that four-cent price hike proved disproportionately costly to the regime and also its people, making the political environment more unstable and the theocracy’s future more uncertain.

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